French legislators have passed a law allowing publishers to set a price that …

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Sorry, Apple—French publishers will set the price you can charge for their e-books, according to a new French law.

Passed last week by both houses of the French parliament, the new law updates France's 1981 "Lang Law" setting prices for paper books. Under that law, publishers could print their price on the back cover a book and every bookstore in the country had to sell it for about that price. A tiny 5 percent discount was the maximum allowed by law, as Amazon found out years ago when a judge held it liable for violating the Lang Law by offering free shipping on its books. (This amounted to more than 5 percent off the list price.)

The new law brings that principle into the digital age, but with a twist: it attempts to apply itself outside France, as well. Under the new scheme, it is publishers who will set a single price for their e-books, which distributors must follow. So long as the publisher is French, distributors must abide by the list price even if based elsewhere.

The point of such laws is to keep prices up in order to fund French culture and insulate it from the ruthlessness of the market. It also provides a level playing field for retailers; mom-and-pop booksellers can compete even with the largest of hypermarchés, since everyone's selling at the same price. The downside for book buyers, of course, is that books don't go on sale.

Still, French politicians love the law. As MP Christian Kert put it last week, "Must we recall how the regulation created by the Lang Law has helped ensure cultural diversity and editorial creativity, accompanying the almost continuous growth of the market of French books for thirty years? We also know that book prices are favorable to the public."

This is essentially the "agency model" written into national law. Booksellers in the US forced Amazon to adopt such a model, where the publisher—and not Amazon—sets the sale price, and similar pricing laws exist for paper books in other European countries like Germany. Apple uses such a model, too.

But France is the first to throw the law at e-books, and it's quite pleased with that fact. "I am happy, as we all must be tonight, that our gathering is prepared to vote definitively on what will be the first such law in the world for digital books—a pioneering text in our ever-changing world," said MP Hervé Gaymard last week as a joint parliamentary commission presented its final version of the bill text.

French Culture Minister Mitterand said that "the book remains a unique cultural artifact, irreducible to a solely commercial dimension Thirty years after the Lang Law on book prices, here is founding legislation for the book trade and the regulation of cultural industries in the digital age."

And he expressed his firm belief that "the editor should to be able to control the value of the book, regardless of the location of the distributer. I am therefore delighted that the balance struck by the joint committee allows distributors in France of playing on equal footing with those outside our borders."

This raises obvious questions, including: is the EU really going to let this happen? Not even France knows. At yesterday's e-G8 meeting on intellectual property, Mitterand expressed his hope that France's "European friends" would not interfere.

But as Publishing Perspectives noted back in March, the European Commission has already raided French publishers on suspicions of e-book price fixing. And trying to impose French law on non-French distributors raises huge legal questions that France hopes to massage away under the EU's "cultural exception" (national laws deemed necessary to protect local cultures can sometimes avoid EU scrutiny).